Chromatin modifications have been implicated in the self-renewal and differentiation of embryonic stem cells (ESCs). Our previous studies have found that histone variants H2A.Z and H3.3 are highly enriched in enhancers and promoters of transcription in differentiated cells. However, the function of histone variant H2A.Z in ESCs remains unclear. We show that H2A.Z is highly enriched at promoters and enhancers and is required for both efficient self-renewal and differentiation of murine ESCs. H2A.Z deposition leads to an abnormal nucleosome structure, decreased nucleosome occupancy and increased chromatin accessibility. In self-renewing ESCs, knockdown of H2A.Z compromises OCT4 binding to its target genes and leads to decreased binding of MLL complexes to active genes and of PRC2 complex to repressed genes. During differentiation of ESCs, inhibition of H2A.Z also compromises RA-induced RAR&#945; binding, activation of differentiation markers and the repression of pluripotency genes. We propose that H2A.Z mediates such contrasting activities by acting as a general facilitator that generates access for a variety of complexes both activating and repressive.